Best Business Books: Knowledge

Since the friction of human nature slows the wheel of learning, Handy offers three “lubricants.” First, be “properly selfish”: focus learning on your own talents and abilities. Next, continually reframe questions and propose trial answers; embrace new perspectives; don’t get stuck in the box of your past ideas and approaches. Finally, get comfortable with uncertainty and change: Dealing with rapid change and discontinuity is where your added value is greatest.

All this learning demands a new organizational model. “Clever people have to be managed rather more sensitively than were the hired hands of the old factory days,” Handy tells us. People need to participate in decisions, both to improve the business’s results and to motivate individual learning. Senior managers have to delegate decision making. Building on the Roman Catholic concept of subsidiarity, Handy admonishes, “to steal people’s decisions is wrong.” For business units to be agile, they need to be smaller and more focused. Smart machines support smart people, helping improve the quality of decisions. The manager’s role is increasingly to set collective goals, to define who gets to make what decisions, to coach individuals, to ensure that individual objectives are aligned with the organization’s goals, and, ideally, to shape and share a vision that gives purpose to the work of others.

Since organizations are being challenged to raise their performance, companies will, in turn, demand more and more from their knowledge workers. Not everyone will desire to — or be able to — keep up. Long before the Web redefined the world of work, Handy described many of the changes we see today: the end of lifelong employment, the rise of part-time work, differentiation between core players and fringe players, multiple careers, outsourcing of specialized knowledge work.

Handy’s comprehensive vision of the knowledge economy was prescient. But The Age of Unreason is only an insightful sketch. No one yet has offered an actionable blueprint.

The Bright Light of HindsightThe impractical knowledge management advocates of the 1990s make an easy target for criticism: learning organization theorists focusing on individual enrichment and group dynamics while neglecting business results; information technologists trying to “manage knowledge” through knowledge repositories that ignored the dynamics of learning and decision making; the majority of the world’s largest corporations pursuing knowledge and learning initiatives and only a tiny fraction achieving any meaningful bottom-line impact. But, in The Social Life of Information, authors Brown and Duguid go beyond mere criticism to explain what really went wrong.

“The way forward is paradoxically to look not ahead, but to look around,” Brown and Duguid tell us. The authors argue that knowledge and information can’t be separated from context — from the details and subtleties of how people communicate; how they learn; how they use and understand both what they know and the information they have; how they use the tools they have; how knowledge moves across regions; and how relationships between people and companies work and don’t work. Disregard for the realities of how people interact individually and together with information and knowledge explains why the breathless predictions by techno/info/knowledge enthusiasts have fallen flat.

Brown and Duguid provide powerful stories of learning and improved results grounded in context and actual work practice. Knowledge, they argue, finds value only in practice, in use. For example, Xerox’s field service reps relied on informal collaboration and individual expertise to fix machines in the field, ignoring the explicit knowledge-based tools and processes provided by the company. Ultimately Xerox helped the reps improve performance by embracing how they already learned: The company provided mobile telephones so reps could discuss problems with each other while on the job, and also provided more opportunities for them to socialize and exchange stories about work.

Articles published in strategy+business do not necessarily represent the views of PwC Strategy& Inc. or any other member firm of the PwC network. Reviews and mentions of publications, products, or services do not constitute endorsement or recommendation for purchase.